New ideas emerge for developing Lighthouse Inn

New London - Maybe it's time to start considering development options for the historic Lighthouse Inn other than restoring it to its former glory, Economic Development Coordinator Ned Hammond told the City Council Monday.

Hammond, the point of contact for developers interested in buying the city-owned property, addressed the council during a public hearing that gave residents a chance to voice their ideas about the future use and development of the 4-acre property on Guthrie Place.

Nearly 50 people attended the meeting, including several developers who suggested the city's previous invitation to bid was too restrictive and did not allow for many options.

"We still have quite a few people interested, but maybe not for an inn," Hammond said. "Maybe open it up a little bit, listen to some proposals ... whether it's as an inn or for some other use.

With the condition of the closed Lighthouse Inn deteriorating and an assessed value that recently dropped from $3 million to $1.6 million, Hammond said, "Every day that we have it, is an additional burden on the city."

Several council members appeared to be interested in soliciting proposals for the property. There was no formal vote though as Council President Wade Hyslop asked Hammond to come back with ideas about how to open up the process.

The property is currently in limbo. A tax auction last year failed to elicit a single bid at the minimum price of about $577,000 and last month the City Council rejected the lone offer from a developer who bid $100,000, far below the minimum starting bid of $500,000.

Built in 1902, the inn closed abruptly in 2008 but still elicits fond memories among residents of brunches, weddings and special events. Two main buildings on the property, including a 53,000-square-foot mansion and 33,000-square-foot carriage house, together offer 51 guest rooms.

Hammond said many developers had written off the carriage house as undevelopable because of its condition. The city also recently cut funding for security and maintenance of the property.

He said the property could be used for an inn as a grandfathered non-conforming use, residential homes on an estimated 11 building lots, cluster housing that could double the amount of residences to 22 and age-restricted housing with the right zoning approvals.

Developers have been hesitant because of the inn's condition, the cost to restore it and the fact there are no guaranteed tax breaks or beach rights, Hammond said.

Allyn Devars asked the council to look at the options, such as retaining ownership like they did with Ocean Beach Park.

"We then control the future of that property," Devars said. "We can breathe life into the Lighthouse Inn."

Tim Ryan, a neighbor of the inn, said he has romantic images of wedding parties and other activities coming back to the property but "realistically the city needs it back on the tax rolls."

"I just want you to explore every option," Ryan said.

Among other ideas was former Navy Captain Marcus Fisk, who suggested a group of non-profit historic organizations come together to find an investor and again run it as an inn.

Councilor Michael Passero agreed it should be a more open process for developers and suggested soliciting proposals, "so the situation doesn't get any worse." Any concerns about a proposal, he said, could be addressed by the council, he said.

Councilor Martin Olsen said the process should be a clean slate, giving an opportunity for developers to be "creative and thoughtful."

"It's important we move forward and not let the nostalgia hold us back," Olsen said.